TIDMSMDR
RNS Number : 8831I
Salamander Energy PLC
05 June 2014
5 June 2014
Salamander Energy plc
("Salamander" or the "Group")
Agreement to Sell 40% Stake in Greater Bualuang Area
Non-Binding Heads of Agreement ("HoA") with SONA Petroleum
Berhad ("SONA")
Salamander is pleased to announce that it has signed a
non-binding HoA with SONA to sell an effective 40% working interest
in both the B8/38 concession (containing the Bualuang Field) and
the surrounding G4/50 concession for a total cash consideration of
US$280 million (together the "Transaction").
Under the terms of the Transaction:
-- SONA will pay Salamander US$250 million for a 40% effective interest in the B8/38 concession
-- SONA will pay Salamander US$30 million for a 40% effective interest in the G4/50 exploration
concession
-- Salamander will carry SONA's costs associated with the
drilling of two exploration wells in the G4/50
concession up to an agreed cap
-- SONA will pay Salamander a contingent cash payment in the event of a commercial discovery in
G4/50 of up to $15 million
As at 31 December 2013, Salamander's estimated gross Bualuang
Field 2P reserves were 32.7 million barrels of oil ("MMbo") and
gross 2C resources were 32.3 MMbo.
The Transaction has an effective date of 1 January 2014 and
following its successful completion, the Board has approved a US$50
million capital return to shareholders, equivalent to approximately
11 pence per share. Post closure of the Transaction, and ahead of
the next phase of development of the Bualuang Field, the Group
expects to retire between $200 million and $250 million of current
debt.
The HoA remains subject to, amongst other things, the signature
of final documentation, including share sale and purchase and
shareholders' agreements, which is anticipated to occur prior to
the end of June. A further announcement will be made at that time.
The Transaction is expected to close by the end of Q3 2014
following satisfaction of all conditions, including receipt of both
regulatory and shareholder approvals of both Salamander and
SONA.
Update on Formal Sale Process
Today's announcement is consistent with the strategy articulated
by the Board of Salamander on 1 May 2014 when the formal sales
process was announced, where Salamander stated that it had been
considering a divestment of certain assets, and had also received a
number of preliminary and conditional expressions of interest in
relation to an offer for the Group. The formal sale process (with
respect to potential offers for the Group) has not yet concluded
and continues in parallel, as the Company and SONA progress
Transaction documentation. A further announcement will be made as
appropriate.
James Menzies, CEO of Salamander, commented:
"Our Bualuang field and surrounding acreage has proved to be a
highly successful growth asset for Salamander. The Group's hub
strategy is designed to bring assets to phased maturity, releasing
value in turn and providing for both re-investment in early stage
development and capital return.
The price achieved reflects the quality of Bualuang barrels, and
the prospectivity of the G4/50 acreage which surrounds the Bualuang
Field.
Today's announcement demonstrates the value embedded in the
Group's portfolio, and the Transaction provides an excellent
opportunity to crystallise a portion of that value."
Enquiries:
Salamander Energy + 44 (0)20 7432 2680
James Menzies, Chief Executive Officer
Geoff Callow, Head of Corporate Affairs
Brunswick Group +44 (0)20 7404 5959
Patrick Handley
Elizabeth Adams
About Salamander
Salamander Energy is an independent upstream oil and gas
exploration and production company listed on the main market of the
London Stock Exchange (Ticker: SMDR). The Group has a balance of
producing, development and exploration assets in Thailand,
Indonesia and Malaysia.
About SONA
SONA is a special purpose acquisition company ("SPAC") listed on
the Malaysian stock exchange formed by a group of experienced
senior executives from the oil and gas industry targeting the
acquisition of upstream assets in SE Asia and elsewhere. The
consideration is to be satisfied by SONA via a combination of its
internal funds, raised from the Company's IPO in July 2013, and
external bank borrowings provided by BNP Paribas (subject to final
documentation) who is also acting as Exclusive Financial Advisor to
SONA.
Pursuant to the regulations governing SPACs, the Transaction
will require approval by the Securities Commission of Malaysia and
shareholder approval.
Disclaimer
This announcement is not intended to, and does not, constitute
or form part of any offer, invitation or the solicitation of an
offer to purchase, otherwise acquire, subscribe for, sell or
otherwise dispose of, any securities whether pursuant to this
announcement or otherwise.
The distribution of this announcement in jurisdictions outside
the United Kingdom may be restricted by law and therefore persons
into whose possession this announcement comes should inform
themselves about, and observe, such restrictions. Any failure to
comply with the restrictions may constitute a violation of the
securities law of any such jurisdiction.
Some of the statements in this document include forward-looking
statements which reflect the Group's or, as applicable, the
directors' of Salamander (the "Directors") current views with
respect to financial performance, business strategy, plans and
objectives of management for future operations (including
development plans relating to the Group's exploration and
production). These statements include forward-looking statements
both with respect to the Group and the sectors and industries in
which the Group operates. Statements which include the words
"expects", "intends", "plans", "believes", "projects",
"anticipates", "will", "targets", "aims", "may", "would", "could",
"continue", their negative variations and similar statements of a
future or forward-looking nature identify forward-looking
statements for the purposes of the U.S. federal securities laws or
otherwise. All forward-looking statements address matters that
involve risks and uncertainties many of which are beyond the
control of the Group. Accordingly, there are or will be important
factors that could cause the Group's actual results to differ
materially from those indicated in these statements. These factors
include but are not limited to the following factors: declines in
oil or gas prices; energy demand in South-East Asia; accuracy of
the estimates of the Group's reserves and resources; the Group's
ability to implement successfully any of its business strategies;
the Group's ability to fund its future operations and capital needs
through borrowing or otherwise; outcome of the exploration
activities; increased operating costs; the Group's ability to
obtain necessary regulatory approvals; competition in the markets
where the Group operates; changes in tax rates; changes in
accounting standards or practices; inflation and fluctuations in
exchange rates; the impact of general business and global economic
conditions; changes in political, economic, legal or social
conditions in Thailand, Indonesia, Vietnam or Laos; changes in the
policies of the governments of Thailand, Indonesia, Vietnam or
Laos; and the Group's success in identifying other risks relating
to its business and managing the risks relating to the
aforementioned factors.
Any forward-looking statements in this document reflect the
Group's or, as applicable, the Directors' current views with
respect to future events and are subject to these and other risks,
uncertainties and assumptions relating to the Group's business,
results of operations and growth strategy. Each forward-looking
statement speaks only as of the date of this document. Subject to
any obligations under applicable law, rules and regulations,
neither Salamander nor the Directors undertakes any obligation to
publicly update or review any forward-looking statement or other
information contained in this document whether as a result of new
information, future developments or otherwise. All subsequent
written and oral forward-looking statements attributable to the
Group or individuals acting on behalf of the Group are expressly
qualified in their entirety by this paragraph.
Disclosure requirements of the Code
Under Rule 8.3(a) of the Code, any person who is interested in
1% or more of any class of relevant securities of an offeree
company or of any securities exchange offeror (being any offeror
other than an offeror in respect of which it has been announced
that its offer is, or is likely to be, solely in cash) must make an
Opening Position Disclosure following the commencement of the offer
period and, if later, following the announcement in which any
securities exchange offeror is first identified. An Opening
Position Disclosure must contain details of the person's interests
and short positions in, and rights to subscribe for, any relevant
securities of each of (i) the offeree company and (ii) any
securities exchange offeror(s). An Opening Position Disclosure by a
person to whom Rule 8.3(a) applies must be made by no later than
3.30 pm (London time) on the 10th business day following the
commencement of the offer period and, if appropriate, by no later
than 3.30 pm (London time) on the 10th business day following the
announcement in which any securities exchange offeror is first
identified. Relevant persons who deal in the relevant securities of
the offeree company or of a securities exchange offeror prior to
the deadline for making an Opening Position Disclosure must instead
make a Dealing Disclosure.
Under Rule 8.3(b) of the Code, any person who is, or becomes,
interested in 1% or more of any class of relevant securities of the
offeree company or of any securities exchange offeror must make a
Dealing Disclosure if the person deals in any relevant securities
of the offeree company or of any securities exchange offeror. A
Dealing Disclosure must contain details of the dealing concerned
and of the person's interests and short positions in, and rights to
subscribe for, any relevant securities of each of (i) the offeree
company and (ii) any securities exchange offeror, save to the
extent that these details have previously been disclosed under Rule
8. A Dealing Disclosure by a person to whom Rule 8.3(b) applies
must be made by no later than 3.30 pm (London time) on the business
day following the date of the relevant dealing.
If two or more persons act together pursuant to an agreement or
understanding, whether formal or informal, to acquire or control an
interest in relevant securities of an offeree company or a
securities exchange offeror, they will be deemed to be a single
person for the purpose of Rule 8.3.
Opening Position Disclosures must also be made by the offeree
company and by any offeror and Dealing Disclosures must also be
made by the offeree company, by any offeror and by any persons
acting in concert with any of them (see Rules 8.1, 8.2 and
8.4).
Details of the offeree and offeror companies in respect of whose
relevant securities Opening Position Disclosures and Dealing
Disclosures must be made can be found in the Disclosure Table on
the Takeover Panel's website at www.thetakeoverpanel.org.uk,
including details of the number of relevant securities in issue,
when the offer period commenced and when any offeror was first
identified. You should contact the Panel's Market Surveillance Unit
on +44 (0)20 7638 0129 if you are in any doubt as to whether you
are required to make an Opening Position Disclosure or a Dealing
Disclosure.
Publication on Website
A copy of this announcement will be made available at
www.salamander-energy.com no later than 12:00 noon (London time) on
6 June 2014 (being the business day following the date of this
announcement) in accordance with Rule 30.4 of the Code. The content
of the website referred to in this announcement is not incorporated
into and does not form part of this announcement.
ENDS
This information is provided by RNS
The company news service from the London Stock Exchange
END
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